Mobile ad platform Millennial Media reports higher revenue, but takes impairment charge that leads to reporting big loss
BALTIMORE, Maryland – November 6, 2014 — Millennial Media, Inc., the leading independent mobile advertising platform company, today reported financial results for the third quarter ended September 30, 2014.
“We had another productive quarter as we took significant steps towards strengthening and accelerating our programmatic capabilities”
Financial Results and Business Highlights for the Third Quarter of 2014
Revenue: For the third quarter of 2014, revenue increased to $69.8 million from $56.1 million on a GAAP basis, a year over year increase of 24.4%. Revenue decreased from $86.3 million on a pro forma combined basis, a year over year decrease of 19.1%. Pro forma combined revenue is calculated as the sum of Millennial Media and Jumptap revenue for the entire third quarter of last year.
Gross Margin: Gross margin was 37.8% for the third quarter of 2014 on a GAAP basis compared to 39.6% for the third quarter of 2013 and 38.6% for the third quarter of 2013 on a pro forma combined basis.
Goodwill and Intangible Impairment: As of September 30, 2014, the Company recorded a non-cash impairment charge of $93.5 million related to its goodwill and certain identifiable long-lived assets. The Company identified an impairment assessment indicator based on a substantial decline in its stock price and market capitalization resulting in an excess of the book value of the Company’s net assets compared to the estimated fair value (calculated in accordance with U.S. GAAP) of those net assets at September 30, 2014. The impairment charge reflects the adjustment of certain of the Company’s assets including goodwill to their estimated fair value as of September 30, 2014.
Net Income (Loss): For the third quarter of 2014, net loss was $(109.4) million, compared to net loss of $(4.6) million for the third quarter of 2013. The net loss for Q3 2014 includes the $93.5 million impairment charge described above.
Adjusted EBITDA: For the third quarter of 2014, Adjusted EBITDA, a non-GAAP financial measure (see definition below), was $(6.9) million, compared to pro forma combined Adjusted EBITDA of $0.8 million for the third quarter of 2013. Pro forma combined Adjusted EBITDA reflects Jumptap results for the entire third quarter of last year.
Net Income (Loss) per Share: For the third quarter of 2014, basic and diluted net loss per common share was $(1.02), compared to basic and diluted net loss per common share of $(0.06) for the third quarter of 2013. The impairment charge of $93.5 million described above accounted for approximately $(0.87) of net loss on a per-share basis.
Non-GAAP Net Income (Loss) Per Common Share: For the third quarter of 2014, non-GAAP net loss per common share was $(0.07), compared to non-GAAP net income per common share of $0.00 for the third quarter of 2013.
Other Business Metrics: As of September 30, 2014, Millennial Media reached over 650 million monthly unique users globally, including approximately 175 million monthly unique users in the United States alone. As of September 30, 2014, approximately 60,000 apps and mobile sites were enabled by mobile app developers to operate on Millennial Media’s platform, and Millennial Media had more than 650 million proprietary, anonymous active user profiles used for delivering the most relevant ads to consumers.
Based on information available as of today, Millennial Media expects total revenue for the fourth quarter of 2014 to be in the range of $70 million to $75 million and Adjusted EBITDA to be a loss between $(5.5) million and $(6.5) million.
“We had another productive quarter as we took significant steps towards strengthening and accelerating our programmatic capabilities,” said Michael Barrett, President and CEO, Millennial Media. “During the quarter we announced our agreement to acquire Nexage – a leading independent mobile supply side platform and exchange – and we have begun to align our management organization towards best addressing both the manual and machine-based segments of the mobile advertising market. As we head into 2015, we have a much improved set of capabilities, and we are well positioned, in terms of our organization, people and strategy, to drive revenue growth.”